With market regulator Insurance Regulatory and Development Authority permitting Indian insurance companies to do business with overseas insurance companies, subject to a stipulation that a life insurance company should have a net worth of Rs. 500 crores and for general insurance company Rs. 250 crores and a proven track record of profit for 3 years, Shriram General Insurance Company Ltd purchased a sizeable part of the shares in Philippine based non life insurance company – Monarch Insurance, a 50 year old Philippine SEC registered and Insurance Commission licensed General Insurance Company.
First private insurer Shriram General acquires stake abroad post IRDA approval
In order to meet the capital requirement of Rs. 35 crores, the company has already pumped in Rs. 10 crores and balance 25 crores will be funded by the group insurance arm after getting approval from IRDA.
By acquiring this stake, Shriram General Insurance is the first private Indian company to buy company abroad. Earlier this group had purchased share in the Philippine Company through a Singapore based holding Company – Bharat Investment. In addition to this, in the year 2007, Shriram Group had purchased 40% shares in Monarch for Rs. 7 crores.
Shriram General Insurance Company is a joint venture between Shriram Group, holding 74 stakes in the company and South African based Sanlam Limited, which holds remaining 26% shares in the company. The company has been awarded Excellence in Growth Award for 2 consecutive year’s i.e 2011 & 2012.